Everyone's Watching Florida for the Next Foreclosure Wave. The Data Says Watch Idaho and Colorado Instead.

Foreclosures just jumped 21% nationally. ATTOM's own CEO calls it "normalization." Nobody's explaining why Idaho and Colorado — not Florida — are leading the growth.

Every foreclosure headline this summer has run the same play: cite the national number, quote an executive saying it's fine, move on. ATTOM's Mid-Year 2026 U.S. Foreclosure Market Report shows 227,548 properties with foreclosure filings in the first six months of the year — up 21% from the same period in 2025, up 28% from 2024. ATTOM CEO Rob Barber's own quote in the release: the market is "gradually returning to more typical patterns."

That framing isn't wrong, exactly. But it's an average, and averages hide the part that matters to an investor: growth isn't happening evenly. The states with the worst absolute foreclosure rates — Florida, South Carolina, Indiana — are not the same states with the fastest year-over-year growth — Idaho, Colorado, Georgia. Those are two different lists, driven by two different mechanisms, and only one of them tells you where tomorrow's deal flow is forming.

If you're screening for distressed inventory based on which states have the worst foreclosure rates today, you're reading last cycle's map. The growth-rate list is the leading indicator, and it's pointing somewhere nobody's looking yet.

The list everyone's citing isn't the list that matters

HousingWire's coverage of the ATTOM report quotes Mirza Hodzic, founder of BlackWolf Advisory Group, backing up the normalization read: "The increase is being driven by a mix of financial pressure and continued normalization after several years of unusually low foreclosure activity." Notice he's naming two separate things and treating them as one trend. "Continued normalization" means paused pandemic-era cases finally clearing the pipeline — that's mechanical, and it's real: foreclosure timelines fell to 563 days in Q2 2026, the fastest since 2013, and REO completions jumped 33% as the backlog drains. "Financial pressure," on the other hand, means new distress — households who weren't in trouble a year ago are in trouble now, because of costs that didn't exist at that scale before.

Those two forces don't hit the same states the same way. States with the worst absolute foreclosure rates — Florida (0.27% of housing units), South Carolina (0.26%), Indiana (0.25%), Delaware (0.25%), Illinois (0.23%) — are mostly legacy judicial-foreclosure states where backlog has always run high and slow. That's the "normalization" list. States with the fastest growth — Idaho (+59% YoY), Colorado (+57%), Georgia (+52%), North Carolina (+47%), Mississippi (+45%) — are, with the partial exception of Georgia, healthy, high-appreciation Western and Southern markets that nobody would have flagged as foreclosure risks twelve months ago. That's the "financial pressure" list, and it's brand new.

Idaho and Colorado in particular don't fit the distressed-market stereotype. Both have posted strong job growth and home-price appreciation through most of this decade. If foreclosures are accelerating fastest there, the story isn't "the same old weak markets are getting weaker." It's that the cost side of ownership — not the price side — is what's now pushing recent buyers in strong markets underwater on their monthly budget, even when their equity position looks fine on paper.

The Numbers

National, per ATTOM's mid-year release:

• 227,548 total foreclosure filings in H1 2026 — +21% YoY, +28% vs. H1 2024
• Foreclosure starts: 164,566, up 18% YoY (+66% vs. H1 2020)
• REO completions (bank repossessions): 27,983, up 33% YoY (still 26% below H1 2020)
• Average foreclosure timeline: 563 days in Q2 2026 — the shortest since 2013

The two lists that don't overlap:

• Worst foreclosure rates: Florida 0.27%, South Carolina 0.26%, Indiana 0.25%, Delaware 0.25%, Illinois 0.23%
• Fastest YoY growth: Idaho +59%, Colorado +57%, Georgia +52%, North Carolina +47%, Mississippi +45%

Colorado, drilled down — The Colorado Sun's Front Range reporting shows the statewide pre-foreclosure count (1,945 in Q2 2026, +12% YoY) is still "well below what it was even before the pandemic." That's the topline that supports the normalization read. But the county breakdown tells a sharper story: Adams County pre-foreclosures up 60% YoY (283 filings), Pueblo County completed foreclosures up 91% YoY (37 total — a small base, but a steep line), and statewide "zombie foreclosures" — vacant, abandoned properties sitting in the pipeline — up from 2.6% of pre-foreclosure inventory a year ago to 3.8% now. The state-level average is calm. The county-level and completion-stage data is not.

What's pushing the "financial pressure" side: per Fox Business's reporting on the cost drivers, average annual homeowners insurance hit $2,948 in 2025 (+12% YoY, per Insurify data), average property tax burden rose to $4,427 (+3%, per Attom data), and HOA dues are climbing on top of both. None of that shows up in a mortgage payment. All of it shows up in a monthly budget.

Common Mistakes Investors Make Here

• Screening by foreclosure rate instead of foreclosure growth. Rate tells you where distress already piled up. Growth tells you where it's piling up right now — and growth is where the least-competed-for deals still exist, because other investors are still reading last year's hot-market list.
• Treating "zombie foreclosure" inventory as noise. A vacant, abandoned pre-foreclosure property is often the least competitive acquisition in the whole pipeline — no occupant to negotiate with, no bidding war at auction, and it's exactly the bucket that grew fastest in Colorado's own data (2.6% to 3.8% YoY).
• Ignoring completed foreclosures because starts get all the headlines. REO completions rose faster than starts nationally (33% vs. 18%) — that's supply reaching the market, not just supply entering the pipeline. Auction and REO listings are actionable today; a foreclosure start is a bet on 2027.
• Assuming a high-appreciation market can't produce foreclosure inventory. Idaho and Colorado are proof it can. Equity on paper doesn't pay the insurance bill or the reassessed property tax notice.

Where I Land

ATTOM's "normalization" framing is defensible for the national number and dishonest for the state-level one. Mechanical catch-up explains the rate list — Florida, South Carolina, Indiana have run hot on backlog for years, and faster timelines are draining it. It does not explain why Idaho and Colorado, two markets with no comparable backlog, are posting the two fastest growth rates in the country. That's a new stress vector — insurance and property-tax cost creep landing on recent, thin-equity buyers — and it's concentrated in exactly the markets that got told all year they were the "safe" ones.

If I were sourcing deals with my own money right now, I'd stop screening Florida foreclosure lists purely because Florida has the worst rate, and I'd start building pre-foreclosure and zombie-foreclosure lists in Colorado and Idaho zip codes with heavy 2021–2023 purchase-vintage concentration — that's the buyer cohort with the thinnest equity cushion against a tax and insurance shock. The rate list is where the crowd is. The growth list is where the crowd isn't yet.

Here's the calibrated call: by ATTOM's H1 2027 mid-year report, at least three of today's top-five YoY-growth states (Idaho, Colorado, Georgia, North Carolina, Mississippi) are still posting double-digit YoY foreclosure growth, even as the national growth rate decelerates toward high-single-digits as the pandemic-era backlog finishes draining. If that holds, it confirms this isn't a one-quarter blip — it's a cost-of-ownership story that keeps compounding in specific markets while the national average quietly settles down and lulls everyone else back to sleep.

How to Use PropGPT for This

"Find properties in [Ada County, ID / Adams County, CO] currently in pre-foreclosure or with a notice of default filed in the last 90 days, purchased between January 2021 and December 2023." This isolates the exact buyer cohort with the thinnest equity cushion against the property-tax and insurance cost increases driving the "financial pressure" side of the spike.

"Show me vacant properties in [zip code] flagged as absentee-owned with an active foreclosure or pre-foreclosure status." This targets zombie-foreclosure inventory directly — the least-competitive acquisition category, since there's no occupant to negotiate with and typically less auction-day competition.

"Pull the current AVM and estimated remaining loan balance for [address], and calculate the owner's equity cushion." Before you approach a pre-foreclosure owner, this tells you whether they have room to sell traditionally (and pocket proceeds) versus needing a short-sale or subject-to structure — the deal shape changes completely depending on the answer.

"Compare foreclosure filing counts for [county] in the trailing 12 months against the prior 12 months, and flag if the year-over-year growth rate exceeds 40%." Run this across the counties you're watching to build your own real-time version of the ATTOM growth list — don't wait for the next quarterly report to catch the next Idaho or Colorado.

"Skip-trace the owner of record at [address] and generate a contact list for pre-foreclosure properties in [county] filed in the last 60 days." This builds your direct-outreach pipeline before the property reaches auction, when you still have room to negotiate a private sale instead of bidding against other investors on the courthouse steps.

The Bottom Line

The national foreclosure number went up 21%, and the executive quote calling it "normal" is technically defensible and practically useless if you're trying to find deals. The rate list (Florida, South Carolina, Indiana) is where the backlog always was. The growth list (Idaho, Colorado, Georgia, North Carolina, Mississippi) is where something new started happening this year, and it's happening in markets built a reputation on being the safe, appreciating alternative to the Sun Belt. Build your screening list off the growth-rate data, not the rate-ranking headlines everyone else is reading, and you're sourcing in the two states where the least competition currently exists relative to how fast the opportunity is growing.